Module 5: Trading Basics

Welcome back to Wayex Academy! Trading is an ancient practice that’s evolved into the fast-paced digital world of crypto. From bartering salt and spices to transacting Bitcoin on global exchanges, our ability to trade never stops evolving.

Crypto markets operate 24/7, with wild price swings that can happen at breakfast or bedtime, making it both exciting and high-risk. Mastering the basics here will help you confidently navigate the ups and downs, avoid emotional pitfalls, and place trades with a clear strategy.

What You’ll Learn:

✅ Key strategies for risk management and emotional control 🛡️💡

✅ How to read candlestick charts 📉 and interpret volume bars 📊

✅ Understanding support and resistance levels 📏 to time your trades ⏳

✅ Common trading styles (scalping ⚡, swing ⏳, momentum 🚀, position 🏦) and when to use them

✅ Practical tips for placing your first trade and managing open positions on Wayex 🏛️

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Section 1: The Evolution of Trading

From Bartering to Bitcoin

• 🔄 Long before currencies, people exchanged goods like cattle, grains, and spices.
• 📈 Traditional stock markets have “open” and “close” times, whereas crypto trades round the clock, no closing bell!

24/7 Markets

• 🚀 Crypto never sleeps, so significant price changes can occur any time.
• 🕰️ Plan for time-zone differences if you’re trading internationally, and remember to step away when you need rest.

Crypto vs. Stocks

• ⚡ Volatility: Crypto can swing 10–20% (or more) in a day, while most stocks move slower.
• 🌍 Accessibility: Crypto is open to anyone with an internet connection—no broker or banking hours required.

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Section 2: The Hallmarks of a Successful Trade

Risk Management 🛡️

🔹 Don’t bet your entire portfolio on one trade—risk only 1–2% per position.
🔹 Use a stop-loss order to automatically exit and limit losses.

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Emotional Control 🧘

🔹 FOMO (Fear of Missing Out) and panic-selling can destroy even the best strategies.
🔹 Base decisions on logic, not hype or fear.

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Trend Identification 📈

🔹 “Swim with the tide” by trading in the market’s overall direction.
🔹 Overcomplicating & fighting the trend often leads to avoidable losses.

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Clear Strategy 🎯

🔹 Define your entry, exit, and stop-loss BEFORE clicking Buy or Sell.
🔹 Stick to your plan, even when the market gets choppy.

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Section 3: The Highs and Lows of Crypto Trading

The Highs (Opportunities) 🚀

• Volatility: Rapid movements can mean fast profits for disciplined traders.
• Global Access: Trade anytime, from anywhere.
• Quick Gains: Crypto’s sharp moves can offer short-term successes.

The Lows (Risks) ⚠️

• Sudden Drops: Losses of 30% or more in a few hours aren’t uncommon.
• Leverage Dangers: Borrowing to increase trading power can rapidly deplete your funds if the market moves against you.
• 24/7 Burnout: With no downtime, it’s easy to get hooked and lose sleep.

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Section 4: The Wayex Trading Experience

🛠️ Wayex offers a user-friendly platform with tools for beginners & pros.

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Key Trading Tools 🛠️

📋 Order Panel – Market/Limit orders for buying/selling crypto.
📈 Live Price Charts – Study trends in real time.
📊 Market Depth & Order Book – See active buy/sell orders & market sentiment.
📒 Trade History & Portfolio Tracking – Monitor your performance.

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Market Orders vs. Limit Orders

⚡ Market Order: Executes immediately at the best available price. Fast but may cause slippage.
🎯 Limit Order: Executes only at a specific price or better—more control!

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How to Place an Order

🟢 Choose "Buy" or "Sell", select Market or Limit order.
📊 Enter price (for Limit orders) & trade amount.
🧐 Review fees, confirm & track your trade.
🚨 Set a stop-loss for extra protection against price drops.

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Watch the Video Below to Understand Simple vs Advanced Trading on Wayex

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Section 5: Reading Price Charts & Market Analysis

How to Read a Price Chart

Price charts are vital for understanding market trends and making informed trading decisions. Candlestick charts are the most common type, displaying price movement over a set period. Each candlestick shows four key data points:

🔹 Open – Price at start

🔹 Close – Price at end

🔹 High – Highest price reached

🔹 Low – Lowest price reached

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The thinner lines above and below the candle body are called wicks, representing the high and low during that interval.

Volume bars (often displayed at the bottom of the chart) indicate how many units of a cryptocurrency have been traded during a specific time. High volume generally correlates with bigger price movements, this could be a sign that traders are bullishly piling in or bearishly selling off.

By spotting trends (upward, downward, or sideways) and recognising familiar patterns, traders can anticipate potential market moves. For example, an extended upward trend on high volume might suggest continued bullish momentum, at least until buyers run out of steam.

Summary:

• Candlesticks show price movements over a specific time period.
• Volume bars reflect trading activity levels.
• Trends and patterns help predict potential market movements.

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Candlestick Charts 🕯️

🟢 Green Candle – Price closed higher (bullish 🐂).
🔴 Red Candle – Price closed lower (bearish 🐻).
📏 Wicks (Shadows) – Show high & low price movements.

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Support & Resistance 📉📈

📊 Support: A "floor" where buyers step in (e.g., $148,176 AUD).
🛑 Resistance: A "ceiling" where sellers emerge (e.g., $168,688 AUD).
🚀 Breaking resistance = upward movement.
📉 Losing support = further drops possible.

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Section 6: Key Trading Terms

📏 Spread – The gap between highest buy & lowest sell offer.

💧 Liquidity – How easily assets can be bought/sold.

⚠️ Slippage – Difference between intended & actual execution price.

📊 Volume – Total crypto traded in a given period.

🚨 Stop-Loss Order – Auto-closes trade to limit losses.

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Section 7: Common Trading Styles & Strategies

1. Scalping ⚡
   
   • Multiple rapid trades, each targeting small profits.
   • Requires intense focus and market awareness.
2. Swing Trading 🔄
   
   • Holding positions for days or weeks to capture market “swings.”
   • Less hectic than scalping but still requires active monitoring.
3. Momentum Trading 📈
   
   • Jumping in when a coin’s price is accelerating upward (or downward) and exiting when momentum fades.
   • News events and market sentiment can heavily influence momentum.
4. Position Trading 🏛️
   
   • Longer-term approach (weeks to months), often based on fundamental factors.
   • Less time-intensive but still needs to watch for major trend shifts.

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Key Takeaways

✅ Crypto Never Sleeps: Embrace the 24/7 nature, but protect your mental and physical well-being.

✅ Market vs. Limit Orders: Market orders fill immediately at current prices, while limit orders wait for your chosen price.

✅ Chart Essentials: Candlesticks and volume bars reveal market sentiment; support and resistance guide entry/exit decisions.

✅ Risk Management: Stop-loss orders and controlled position sizes can save you when volatility spikes.

✅ Strategy & Emotion: FOMO and panic-selling are pitfalls, discipline and preparation are strengths.

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Up Next: Advanced Trading Strategies & Risk Management. Let’s keep building your skills so you can tackle the crypto markets with poise and precision!

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Quiz – Test Your Knowledge!

Here’s a 15-question multiple-choice quiz based on Wayex Academy – Module 5: Trading Basics.

Each question has four answer choices, with the correct answer indicated.

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Scoring:

🎯 13-15 Correct: Basic Trading Pro! 🚀

✅ 10-12 Correct: Well Done! You have a solid understanding, keep learning and exploring.

🧐 7-9 Correct: Good Start! You’re getting there, but review some sections again.

❌ Below 7 Correct: Keep Learning! Go back through the module and try again

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